2016 Extended Care Market Report
Skilled nursing facilities, the largest single extended care market segment, are increasingly shifting toward short-term, higher-acuity care. In a 2016 HIDA survey, 82% of administrators surveyed reported acuity increases. Occupancy remains near 86%, and the numbers of beds and facilities are relatively flat. Growth rates vary by segment. Assisted living facilities are projected to grow 5% annually through 2019. Continuing care retirement communities are experiencing 3.7% annual growth, and hospice patient volume increased 7% from 2013 to 2104. Home care is a growth area, although the number of home health agencies remains at about 12,400; 80% of these are for-profit providers.
Increased cooperation between extended care facilities and hospitals, as well as with other post-acute providers, is a key trend. Providers are working more closely together to reduce hospital readmissions. At the same time, they are also dealing with an aging population demanding flexible home healthcare options. Staffing is a challenge in all extended care settings. Nursing facility administrators are reporting turnover of up to 50%. Extended care must compete for registered nurses, yet annual salaries in these settings can be $30,000 less than those in hospitals.
Providers are slated for modest payment increases in 2017. Medicare reimbursements will increase an average of 2.1% for skilled nursing facilities, and 2% for hospices. However, home health agencies will receive an average payment cut of -1.8%. Agencies in selected states will begin a new value-based payment model that could result in quality-based bonuses.
GHX Sales Data
Distributor sales of medical products in extended care accounted for 20.7% of the total $42.3 billion in sales through distribution in 2015. The Global Healthcare Exchange Market Intelligence program also reports on top long-term care products by dollars sold, types of long-term care segments by dollars, home health submarkets by dollars, and top home health product categories by dollars.